Whilst Generation Rent is complaining about their sky-high living costs, renting is actually the cheaper option in many UK cities, according to a new study.
Property platform Zoopla put together a new comparison and found that the average monthly rental cost in many of the UK’s biggest cities is actually lower than monthly mortgage repayments.
Rental price growth slows as landlords are reluctant to push them up
Not very surprisingly, London showed the biggest gap between rental costs and mortgage repayments. The capital’s homeowners who have a mortgage with a 90% loan to value ratio are expected to pay £3,000 per month whilst average rents come in at £1,861.
Cambridge made it into second place with a monthly mortgage repayment of £1,488 and monthly rents averaging out at £1,099.
Liverpool, Bedford, Reading and Brighton also made it into the top 10.
Glasgow represented the other end of the spectrum with rental cost averaging at £649 whilst monthly mortgage repayments are only $475, and therefore 31% less.
Zoopla’s spokesperson, Lawrence Hill, said:
“These figures are encouraging for those who are currently renting and perhaps looking to save as much as they possibly can to get on the property ladder.”
Times are looking quite rosy for those who already own a home, according to the latest house price sentiment index by Knight Frank and IHS Markit.
The index revealed that over 17% of the 1,500 households surveyed said that the value of their home had increased over the last month. In comparison, only 6.5% said the price of their home had dropped.
Oliver Knight, an associate in Knight Frank’s residential research team, explained:
“The recent softening in sentiment in the immediate run up to the General Election in June may be a reaction to the slight uncertainty that inevitably comes with the vote, combined with wider inflationary pressures as well as affordability concerns in parts of the country. Yet at the same time, a lack of supply of housing for sale is underpinning pricing across much of the UK.”
